A lesson in Relative Strenght

We focus on trading relatively strong stocks long, and we focusing on shorting relatively weak stocks.

How can you tell if a stock is relatively strong or weak very quickly?

By looking at there daily chart compared to other stocks in there sector. A relatively strong stock will be trading in the top far right of its daily chart. While the relatively weak stocks will be trading near the bottom right of its daily chart.

Between FB, LNKD, and TWTR, which stock looks to have the most relative strength?

The stock with the most relative strength will have the less resistance to trade long and will be much easier to trade than the weaker ones. The correct answer would be FB, when looking for short term day/swing trades we find to find the best stocks to trade, not the cheap deals.


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